Business travel

Taxi drivers demand fuel surcharges

CITING the increased cost to fill their tanks, the association that represents London's taxi drivers is lobbying to add a fuel surcharge to all fares. If the Licensed Taxi Drivers Association is successful in its appeal to Transport for London, the city's transport overseer, London will join a worthy international group. Singapore has just added a S$0.3 ($0.2) surcharge, and at least 34 American cities have raised rates in the last two years, with 11 implementing specific new fuel surcharges, according to CNN.

In Philadelphia, for example, transfers to or from the airport in July are costing travellers an extra $2.85, based on an average gas price of $4.12 per gallon. The surcharge in June was $2.45, when a gallon cost nearly 40 cents less. Taxis in Miami-Dade County add a surcharge of $1-1.50 per ride, depending on fuel costs, while Chicago charges a flat rate of $1. New York is one of the last holdouts: taxi drivers there have been unsuccessful so far in their attempts to convince the New York Taxi and Limousine Commission to allow them to add a $1 surcharge.

Readers' comments

It's interesting to note that all these surcharges are demanded only when oil prices go up. Did the same taxi operators reduce fares when the oil price went down in mid/late 90s? Does anyone have quarterly/annual data on this i.e. gas prices v/s taxi fares? PlayDumb

Didn't the airline industry invent surcharges so as to avoid travel agents obtaining commission on the extra ticket price? Then other transport sectors picked up the term because they probably thought it sounded better than just jacking up the price.

This is a good article on Taxi drivers, who are demanding fuel surcharges. I think that its not require to increase surcharges.================================================caroline16Addiction Recovery New Jersey

NO NO NOEvery normal business has to manage their costs - why are taxis any different? Bakers don't add a 'flour surcharge' just because wheat prices have gone up... it's more unnecessary complexity to life.OK so taxi prices are typically controlled so they aren't as flexible as other businesses. But when did taxis ever cut tariffs following a fall in fuel prices? Exactly.

Don't know what an average London cabbie makes, but their cost of living is pretty high and their street knowledge extensive. They probably deserve what ever they make. Perhaps a surcharge is more adjustable and can keep going up if necessary.

The $1 increase in Hong Kong is a genuine hike in the flagfall (from $15 to $16 - still amazing value), not a surcharge, but the taximeters are only being recalibrated gradually. There have also been protests by taxi drivers and others (including the fishing fleet) about fuel price increases, but that seems to be directed more at the Government to reduce fuel taxes.

I find it entirely unsurprising that London taxi drivers are asking for an increase. The price seems to have gone up every time I visit, and I still don't understand why they need a higher tariff for evenings and weekends.

The problem with surcharges is that once they are implemented, they are seldom removed. The price of oil today (23 July) is well off its highs. What if oil falls further, would passangers get a rebate?The real issues are that London cabbies are overpaid, work in a near monopolistic environment (in a like for like service) and drive diesel vehicles. A little competition is required - perhaps a fleet of electric cars with SatNav/TomTom (the "Knowledge" street exam is obsolete) and let market forces do the rest.

I think there are rate tables with different rates based on the origin and destination neighborhoods, so if you change the rates then you'd have to reprint all of the rate booklets and any posters inside the cab that tell customers what the rates are, etc. Like this you can just add a sticker inside the cab that says, "$1 surcharge" and all the other printed stuff remains valid.